Experts welcome regulations on the utilisation method of the Fund for supporting agricultural producers for 2007. Info-Prim Neo Analysis

The regulations on the method of utilisation of the fund for supporting agricultural producers, worked out by the Ministry of Agriculture and Food Industry (MAIA), approved by the Parliament this year, has substantially improved compared to the similar regulations in 2006, the economic analyst Viorel Chivriga told Info-Prim Neo. According to him, this fact is mostly due to the collaboration between the MAIA and the civil society, especially the Coalition for Rural Economic Development. Several proposals launched by the Coalition within the advocacy campaign for the improvement of the system for supporting agriculture at the end of the last year have been included in the new regulations. However, the cited source says, there are still unutilized reserves for improving it with the aim of extending the number of those who would benefit from state’s support, ensuring a greater transparency in administrating the financial means of the fund and, implicitly, the increase of their efficiency. Consequently, in 2007, the financing from the Fund for supporting agricultural producers expands in three new directions: the development of the walnut tree culture, the development of the ecologic agriculture and the supplying with technology and equipment of the vegetable producers. The regulation has also improved compared to the previous one, through the introduction of plausible productivity grids for subsidising producers of sugar beet and tobacco. For example, the beet producers will have the opportunity to benefit from subsidies of 200 lei per each initiated hectare. Additionaly, they will benefit from 100 lei/ha in case of obtaining a productivity of 25-30 t/ha; 150 lei/ha – for a productivity of 30-35 t/ha; 200 lei/ha – for a productivity of more than 35 t/ha. In 2006, sugar beet producers have benefited from a support of 250 lei per a seeded hectare and additionally from allocations of 10 lei per each tonne delivered to processing companies, with the condition that the beet harvest exceeds 22 t/ha. This productivity limit is clearly inferior to the average productivity in the republic, registered in 2005 and 2006. A disadvantage of the new provisions, Chivriga says, is the decrease of the financial support related to surface units (ha). However, this disadvantage is compensated by increasing the number of potential beneficiaries from state subsidies. In the case of the provisions regulating the conditions that should be met in order for a tobacco producer to receive support, there have also been registered considerable improvements. These improvements are related to the rational productivity grids, the increase of support from the state per cultivated surface unit and the conditions of eligibility that the beneficiaries should meet, which are more advanced, compared to the previous year. Probably, the expert says, when working out the regulations, the authors took into consideration the fact that this agricultural sector is still a very important one and needs the support of the state. Last year, the surfaces occupied by tobacco were 6.7 times smaller than in 2000. This situation generated a serious deficit of raw material on the internal market, in the conditions of an increased demand. It is not a surprise that in the period from January to November 2006, the manufacturing of tobacco produces reduced by 22% compared to the similar period of the last year. [Farmers are no longer discriminated] Chivriga also mentioned that in the domain of stimulating the production of fruit-growing seeding material and creating fruit-growing plantations, the authors of the regulations finally reached the situation when there is no more discrimination among farmers on the base of the administrated surface. When working out the regulations, MAIA took into consideration the provisions of the Government’s Decision no. 1043 dated on September 8, 2006, on improving the mechanism of providing subventions for agriculture, which states that “subventions will be accorded to agricultural producers, regardless to the type of property, the type of the company or the size of the farm, based on objective and transparent eligibility criteria. Criteria for selecting beneficiaries will be revised in order to specify the procedures used in the case when the available sources cannot satisfy all the requests, and the surface for planting vineyards and gardens, eligible for subvention, will be reduced to 0.5 ha”. In 2006, companies which created seed beds and those who initiated, starting 2005, fruit-growing plantations on a total surface of at least 5 ha, benefited from the partial compensation of the expanses for producing or purchasing the seeding material. In case of creating fruit-growing plantations with a total surface of less than 5 ha, compensations were accorded with the condition that they are merged with plantations initiated in the last 3 years, the total surface of which is not less than 5 ha. In the current year, subsidies will be given out for the production of fruit-growing seeding material (grafted fruit trees) – MDL 20,000 per hectare; for initiating, starting with the autumn of 2006, of fruit-growing plantations with varieties included in the Register of plant varieties of Moldova – MDL 10,000 lei per ha of surface, planted with seed varieties and MDL 7,500 – per ha of surface planted with kernel varieties. On December 28, 2006, the Parliament approved the Regulations on the method of utilisation of the fund for supporting agricultural producers. The mentioned fund is approved by the Law of state budget for 2007 for the sum of MDL 240 mln, which constitutes an increase of the resources allocated in the respective fund at the moment of adopting the similar law for 2006 and a decrease by MDL 16 mln compared to the sum of the named fund, modified by the Law no. 391-XVI from December 8, 2006. According to the Parliament’s Decision, the financial resources from the fund for supporting agricultural producers provided for 2007, are distributed as follows: MAIA – MDL 120 mln, including MDL 15 mln for subsidising sugar beet producers; MDL 3 mln for tobacco growers, MDL 17 mln for stimulating the production of fruit-growing seeding material and initiating fruit-growing plantations; 3mln for encouraging the development of the walnut tree culture; 2 mln for supporting the promotion and the development of ecologic agriculture; 45 mln for subsidising the users of phytosanitary products (pesticides) and fertilisers; 15 mln for supporting the the zootechnical sector; 20 mln for subsidising the purchase of agricultural equipment. “Moldresurse” State Enterprise will benefit from MDL 20 mln for stimulating the creation of technological machine stations; the Ministry of Finances, via the Main State Tax Inspectorate – from MDL 100 mln for subsidising agricultural producers when delivering agricultural production of own manufacture on the territory of Moldova.

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